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Home My WebLink About06.b. Receive report on software expenditures Page 1 of 3 Item 6.b. ,orVIOIN SAN October 20, 2020 TO: FINANCE COMMITTEE FROM: JOHN HUIE, INFORMATION TECHNOLOGY MANAGER PHILIP LEI BER, DIRECTOR OF FINANCEAND ADMINISTRATION REVIEWED BY: ROGER S. BAILEY, GENERAL MANAGER SUBJECT: RECEIVE REPORT ON SOFTWARE EXPENDITURES The Finance Committee requested an overview an overview of software related expenditures in January, and the overview was provided at the March 2019 Finance Committee meeting. Since then, Committee members have inquired about specific software expenditures in the periodic check runs. I n light of this, staff are hereby providing an update on software related spending, to include: A. Trends from Fiscal Year(FY) 2018-19 to FY 2020-21 and composition of software spend by type B. Commentary regarding future spending trajectory C. Measures to Ensure Appropriate Management of Software Part A: Trends and Composition Central San's software expenditures can be categorized into six overall groupings: 1. Enterprise software (major software used for organizational wide functions); 2. Desktop Applications (widely used desktop software); 3. Business Applications (applications specific to functions performed by individual departments); 4. Security(tools used by IT to ensure a safe and secure IT infrastructure); 5. SCADA Related (communication and control of operational assets); 6. Backend Systems (tools to maintain back-office IT infrastructure). Most of these expenditures are funded in the O&M budget, but some software is also budgeted in the Capital Budget. The spending noted below for each of these categories was compiled from several sources, including purchase orders, budget, and actual spending information. This was necessary to perform the assessment due to several complicating factors: • Some purchases are made in one year but benefit more than one year(for multi-year agreements). • Prior to FY 2020-21, general ledger accounts used for software purchases also contain hardware and other related items. Compiling a list of just software requires excluding other items on a line by line basis. • Some purchase line items include multiple components such as up-front configuration or services, software license, and ongoing maintenance costs. A more detailed assessment of the software line items contained with these categories, and also funded from the IT Development (8240) project of the Capital Budget includes: October 20, 2020 Regular FINANCE Committee Meeting Agenda Packet- Page 59 of 111 Page 2 of 3 Category: 2017-18 2018-19 2019-20 2020-21 1. Enterprise Software $99,218 $117,102 $500,050 $542,286 2. Desktop Applications $6,717 $112,189 $142,368 $126,758 3. Business Applications $294,118 $304,483 $411,045 $416,652 4. Security $61,539 $79,519 $127,459 $208,827 5. SCADA Related $47,069 $66,221 $69,862 $72,502 6. Backend Systems 100 424 102 301 130 895 117 480 Total $6091085 $781,815 $1,381,679 $1,484,505 Major software (noting vendor/name/description)within each category is summarized below: 1. Enterprise Software • DTS/Oracle (ERP Cloud Software) • SunGard/CentralSquare (previous ERP support) • Cybersource(Oracle payment processing) • I BM (operating system and replication software) • Seven other tools each with annual costs of less than $2,000 • Microsoft EA (Microsoft Enterprise Agreement 2. Desktop Applications {Office 365, operating systems, databases, etc.) • Acrobat Pro (PDF creation) • Docusign (electronic signature) • Two other tools each with annual costs of less than $2,000 3. Business Applications • Cityworks (asset management software) • eBuilder (program and construction management) • LaserFiche (document management) • IT Pipes (sewer pipe video software) • I nfoMaster/I nfoWorks (flow modeling) • AutoCAD (computer aided drafting) • QLess (line queueing software for permit counter) • Adobe Cloud & Illustrator (desktop publishing software) • DigSmart('call before you dig' software) • Novus Agenda (Board agenda management system) • ParcelQuest(parcel data for use in GI S and SunGard) • EverBridge(emergency notification system) • Eleven other tools each with annual costs of less than $5,000 4. Security • Intrusion Detection Software • File monitoring and logging software • 2-Factor Authentication software • Network monitoring and alerting software • Enterprise backup software • Physical security and alarm system • Security video system • Anti-Malware end-point software • Five other tools each with annual costs of less than $5,000 5. SCADA Related • Dynac support(SCADA software support) • Wonderware(Pump Station SCADA system) • Alameda Electric(PLC support/SCADA software support) • One other tool with annual costs of less than $3,000 6. Backend Systems • ESRI (GI S), VMWare(Virtual server environment) • Unity Pro (Programming software) October 20, 2020 Regular FINANCE Committee Meeting Agenda Packet- Page 60 of 111 Page 3 of 3 • GeoCortex Analytics (G I S Application Development software) • KACE (Helpdesk and computer inventory) • F M E Server (Data Manipulation for GIS) • GeoCortex Essentials (G IS Application Development software) • F M E (Data Manipulation for GIS) • Six other tools each with annual costs of less than $1,000 Part B. Commentary regarding future spending trajectory As noted, software expenditures have increased in recent years. This is a trend that should be expected to continue with new investment in the areas of plant operations and plant maintenance software that will enable more efficient and cost-effective management of plant infrastructure through automation, business intelligence tools, workflow and additional use of sensing equipment, implementation of tools to centralize access to information and a likely replacement of our plant SCADA system. Expenditures have grown for three reasons: 1. Inflation: Even without new additions, software maintenance costs typically grow at a rate above inflation; five percent is typical. 2. New Software: Central San has deployed new tools to improve efficiency and customer service levels. Particular examples of this have included Microsoft Office 365 cloud-based collaboration software (including SharePoint, OneDrive, Teams, and cloud versions of all Office Products, Oracle ERP, Novus Agenda, and new external website software). Expenditures in this area allow for more productivity of existing staff, and can help avoid the need for new staff. 3. Security: Central San has been improving information security across a broad range of areas resulting in additional costs. Offsetting these factors are some significant expenditures that will drop off, after an initial period of duplication during a transition period. Examples of these items include support for the SunGard HTE system, and the I ntelliTime timekeeping software, both of which were replaced with new systems. Also, software is sometimes initially deployed but not retained after an initial period of use. Examples include the QLess software used for scheduling appointments at Household Hazardous Waste Facility, which will not be used after the initial first year license due to changes in operational needs. Part C. Measures to Ensure Appropriate Management of Software Software expenditures are budgeted and managed centrally by the IT Division. This allows the IT Division to have oversight over all software related expenditures with the following advantages: • Provide for a well-managed path for software acquisition, usage, and retirement, across Central San; • Provide appropriate IT staff support for applications and infrastructure; • Provide for an appropriate level of ongoing support through software vendor or other third party; • Avoid duplicate expenditures for similar tools; • Provide consideration of alternative, lower cost options; • Ensure compatibility and security of software deployed in the Central San IT environment. GOAL ONE: Customer and Community Strategy 1—Deliver high-quality customer service GOAL THREE: Fiscal Responsibility Strategy 2—Ensure integrity and transparency in financial management GOAL FIVE:Infrastructure Reliability Strategy 1—Manage assets optimally to prolong their useful life October 20, 2020 Regular FINANCE Committee Meeting Agenda Packet- Page 61 of 111